Analyzing Northpointe Bancshares (NYSE:NPB) & Provident Financial (NASDAQ:PROV)

Northpointe Bancshares (NYSE:NPB) and Provident Financial (NASDAQ:PROV) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, dividends, valuation, analyst recommendations, institutional ownership, profitability and earnings.

Analyst Ratings

This is a breakdown of current recommendations for Northpointe Bancshares and Provident Financial, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Northpointe Bancshares	0	0	2	0	3.00
Provident Financial	0	1	0	0	2.00

Northpointe Bancshares presently has a consensus target price of $17.75, indicating a potential upside of 9.37%. Provident Financial has a consensus target price of $16.50, indicating a potential upside of 8.13%. Given Northpointe Bancshares’ stronger consensus rating and higher probable upside, research analysts plainly believe Northpointe Bancshares is more favorable than Provident Financial.

Valuation and Earnings

This table compares Northpointe Bancshares and Provident Financial”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Northpointe Bancshares	$390.45 million	1.43	$55.16 million	N/A	N/A
Provident Financial	$60.15 million	1.70	$6.26 million	$0.93	16.41

Northpointe Bancshares has higher revenue and earnings than Provident Financial.

Insider & Institutional Ownership

71.3% of Provident Financial shares are held by institutional investors. 18.4% of Northpointe Bancshares shares are held by insiders. Comparatively, 11.4% of Provident Financial shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Northpointe Bancshares and Provident Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Northpointe Bancshares	N/A	N/A	N/A
Provident Financial	10.40%	4.85%	0.50%

Dividends

Northpointe Bancshares pays an annual dividend of $0.10 per share and has a dividend yield of 0.6%. Provident Financial pays an annual dividend of $0.56 per share and has a dividend yield of 3.7%. Provident Financial pays out 60.2% of its earnings in the form of a dividend.

Summary

Northpointe Bancshares beats Provident Financial on 7 of the 13 factors compared between the two stocks.

About Northpointe Bancshares

Northpointe Bancshares, Inc. operates as a bank holding company. It offers a nationwide mortgage purchase program, residential mortgage loans, digital deposit banking to retail customers and custodial deposit services. The company was founded by Charles A. Williams in 1998 and is headquartered in Grand Rapids, MI.

About Provident Financial

Provident Financial Holdings, Inc. operates as the holding company for Provident Savings Bank, F.S.B. that provides community banking services to consumers and small to mid-sized businesses in the Inland Empire region of Southern California. The company's deposit products include checking, savings, and money market accounts, as well as time deposits; and loan portfolio consists of single-family, multi-family, commercial real estate, construction, mortgage, commercial business, and consumer loans. It also offers investment services comprising the sale of investment products, such as annuities and mutual funds; and trustee services for real estate transactions. The company operates through full-service banking offices in Riverside County and San Bernardino County. Provident Financial Holdings, Inc. was founded in 1956 and is headquartered in Riverside, California.